Oil price jumps on weaker dollar

A number of factors are behind the latest rise

The price of crude oil in New York jumped as the dollar weakened, and fears over the impact of the first Gulf storm also pushed the price higher.

In mid-morning trade in the US the cost of light, sweet crude was up more than $2 at $79.49.

Oil is priced in dollars so when it falls investors holding other currencies can buy more.

Tropical Storm Ida is weakening but there is still nervousness about whether it will affect oil production.

'Cautious'

It had initially been listed as a Category 1 hurricane but it has now been downgraded by the US National Hurricane Centre.

The storm looks like it will miss the most of the energy production region.

"At this point it seems unlikely that there will be any major damage to the facilities in the Gulf, yet the market has to be cautious," said PFGBest analyst Phil Flynn.

He added "It is hard to determine how much of the rally in oil is Ida related and how much of it is dollar related".